Public Service Amendment Bill [B31 B-2006]: Briefing by DPSA

Meeting report

LOCAL GOVERNEMENT AND ADMINISTRATION SELECT COMMITTEE
31 July 2007
PUBLIC SERVICE AMENDMENT BILL [B31 B-2006]: BRIEFING BY DPSA

Chairperson:  Mr S Shiceka (ANC, Gauteng)

Documents handed out
Public Service Amendment Bill [B31B-2006]  
Department of Public Service and Administration Presentation on Bill

Audio recording of meeting

SUMMARY
The Department of Public Service and Administration briefed the Committee on the Public Service Amendment Bill, which aimed to strengthen the organisational and human resource pillars of the Public Service Regulatory Framework. There was a need to create flexible institutions that were much more accountable to a political head, to strengthen compliance and reporting frameworks, to empower managers to take the decisions in a fully accountable way, and to amend the disciplinary processes. The Bill also addressed areas of the Act that were obsolete or unduly complex to administer.

The Department explained the changes to the definitions in Clause 1. There was now provision for alignment between conditions of service of general public service and sectors with their own employment laws A Committee of Ministers was to concur with determinations on annual salary adjustments, salary scales and levels, performance bonuses and pension benefits. Before the Minister could exercise certain powers there must be a collective bargaining process. References to “promotions” had been deleted to obviate problems where unsuccessful candidates for higher posts could challenge the decision as unfair labour practices. A new organisational form, of a government component within the public service, was proposed, and was fully outlined.
Government agencies were to be listed in Schedule 3 together with principal departments. The first proposed component was the Centre for Public Service Innovation, having the DPSA as its principal department. It was proposed that the current Schedule 3 organisational components (Independent Complaints Directorate, Intelligence Academy and Inspectorate for Social Assistance) be moved to Schedule 1. Clarity was given on the creation of components and the functions they would perform, as well as the advantages. Specialised Service Delivery Units were outlined and described. The Department then discussed the transfer of employees, and the new procedures in the Bill. Procedures on personnel and disciplinary procedures against heads of departments and employees were set out. The grounds of dismissal were now aligned with those recognised in the Labour Relations Act. The requirements on outside remunerative work were amended, and criteria for permission were set out. A new procedure was set out for grievances of heads of departments. There was now provision for delegation of functions. There were new provisions on retrospectivity and deviation of regulation making powers.

Members raised questions of clarity on some of the terms in the definitions. They noted that there would be a need for a further in-depth consideration of the clauses. The position in respect of pension and medical schemes was questioned and it was clarified that this Bill differed from the proposals for a single Public Service. Clarity was sought on the transfer of employees without consent, deemed dismissal, outside work, the application of the Bill to municipal councilors, the reason for doing away with the term “promotion”, the accountability of heads of components, whether this Act would apply also to parastatals, and the implications of the committee of ministers.

MINUTES
Public Service Amendment Bill (the Bill): Presentation by Department of Public Service and Administration (DPSA)
Prof Richard Levin, Director-General, DPSA, stated that the main aim of the Amendment was to strengthen the organisational and human resource pillars of the Public Service Regulatory Framework. In recent years the Department had seen gaps in the human resource arrangements of the Public Service Act (PSA) that hampered the internal efficiency and service delivery. Dealing with these matters would ensure that there was a more efficient and effective Public Service that was in line with the constitutional requirements of Chapter 10 of the Constitution. There had inadequate provision for the deployment of staff, some functions were provided by departments away from points of service delivery and without direct accountability or decision making was done by entities outside the public service without direct control by a political head. The deployment of skilled personnel was very important. There were capacity constraints and it was important to get the correctly-skilled people to deliver services to the public. Globally, in the area of Public Administration, there was a move over the last 20 years to look at alternative forms of service delivery, and to find the most relevant institutional form for government to use in the delivery of services. In the South African context post-1994 the Department began to explore alternative ways of delivering services. The creation of agencies and entities gave more flexible opportunities and arrangements for delivering services, but the downside was that some public entities operated without strong enough mandates from a political head and accountability was a problem. Therefore the Bill sought to address the creation of flexible institutions that were much more accountable to a political head.

Other areas hampering service delivery included lack of compliance with the Public Service Act. The decentralised Human Resource Management Framework sometimes resulted in tenuous mechanisms for ensuring compliance. The answer was not to re-centralise but to strengthen the compliance and reporting framework, to empower managers at the points of operation and points of service delivery to take the decisions in a fully accountable way that would meet the requirements of the Constitution. There also had been some problems with the disciplinary processes, where employees suspected but not charged with transgressing might resign and move to another department, or even where those dismissed for misconduct could be re-employed elsewhere in the public service.

There were also a number of technical issues addressed through the Bill, in order to bring clarity, and the areas of the Act that had become obsolete or complex to administer were being amended.

Ms Empie van Schoor, Chief Director of Legal Services, DPSA, then took the Committee through the clauses. Clause 1, dealing with definitions, was replacing definitions of “executing authority” with “executive authority”, the term used in the Public Finance Management Act (PFMA). A definition for employment practices was inserted, and definitions of sector members, salary level and salary scales were also clarified. There was now provision for alignment between conditions of service of general public service and sectors with their own employment laws (Educators, SAPS, Defence, Intelligence and Correctional Services) where desirable. A Committee of Ministers was to concur with determinations on annual salary adjustments, salary scales and levels, performance bonuses and pension benefits.

It was made quite clear in the Bill that before the Minister could exercise power regarding matters of mutual interest these would be subject to collective bargaining the Public Service Co-ordinating Bargaining Council (PSCBC) and the relevant sectoral bargaining council. Collective agreements concluded in respect of employees falling under PSA were to be regarded as Ministerial determinations to enhance implementation and compliance, under Clause 7.

Ms van Schoor pointed out that all references to “promotions” had been deleted. All Senior Management Service posts were to be advertised outside the public service, and there was also a discretion to do the same for other posts below the level of senior management. Currently, if an existing employee was appointed to a higher post in the public service this was regarded as a promotion. Unsuccessful internal candidates for a post could refer unfair labour practice disputes to the bargaining council, whilst external candidates could not. The Department proposed that external and internal candidates be put in the same position so that neither could declare an unfair labour practice dispute. There would still be remedies under the Employment Equity Act (unfair discrimination) and Promotion of Administrative Justice Act (fair administrative action).

Current institutions under the PSA could be established and disestablished by the President by proclamation in a Gazette and mainly dealt with the internal organisation of the public service. A new organisational form, of a government component within the public service, was proposed. This would be a dedicated entity under the direct control of the Minister/MEC/Premier to enable direct service delivery in particular areas. This mechanism was aimed at bringing back public service institutions outside the public service, which had functions that should be performed by institutions within the public service, but could be done only if recommended by a feasibility study.  It was proposed that regulations would specify what was to be contained in the feasibility study. The head of this government component would report directly to the relevant executive authority (Minister/MEC/Premier) and this head was also the accounting officer for the component. This was similar to the job of the Director General of a department. All prescripts of the PSA would apply to the components’ organisation, governance and staff, who would be employed in terms of the PSA. They would also be subject to collective bargaining. The definition of public service in the Labour Relations Act was also amended to include these components. The functions of the components could be original, assigned or delegated. These terms were explained. It was proposed in the Bill that a Minister may only assign such functions to a head of a component with Parliament’s approval. Such assignment must be done by notice in the Government Gazette. Components could not undertake functions with socio-economic implications, for example, healthcare or housing.

Government agencies were to be listed in Schedule 3 together with principal departments. The first proposed component was the Centre for Public Service Innovation, having the DPSA as its principal department. It was proposed that the current Schedule 3 organisational components (Independent Complaints Directorate, Intelligence Academy and Inspectorate for Social Assistance) be moved to Schedule 1.

Ms van Schoor clarified how components were created. DPSA proposed that the President establish components by proclamation. In the case of national components, it was proposed that these be established on the request of a national Minister and advice of Minister of Finance and the Minister for Public Service and Administration. Provincial components would be established on a Premier’s request, after consultation with the Minister of Finance and the Minister of Public Service and Administration. There was no requirement for agreement from the two ministers. The President could only refuse the establishment of a provincial department from the Premier if the President felt that it would be unconstitutional or contradicted the PSA.

The Department proposed that for each component there should be a notice in a Gazette, and the prescribed and optional functions were set out in full in the presentation.

Ms van Schoor pointed out the main differences between departments and government components. A government component would be a body that was established to perform specific functions, which would not have a core policy development function, but would have assigned functions with accompanying direct accountability. A government component was to be partnered with a department that must assist the executive authority with oversight in respect of policy implementation. Contrary to a department a component may have an advisory or consultative board.

The advantages of a government component were that it would enable customization of administrative and operational arrangements to suit a service delivery environment, could enable better governance via direct accountability and decision making as close as possible to the point of service delivery, and allow political heads more direct control over service delivery outcomes without the need to create entities outside the public service.

The next proposal was the Specialised Service Delivery Unit. This was a ring-fenced unit that would be established within a department, following a feasibility study. Its features were similar to those of government components except that it could perform socio-economic functions, without limitation. It would be established by the relevant executive authority and the Minister must by notice in a gazette give effect to it. DPSA proposed that the executive authority develop protocol to set out the functions and administrative and operational arrangements. If the executive authority or head of department delegated any human resource related functions, this must be done to the Head, who would also receive delegation of any financial powers.

Mr Ailwei Mulaudzi, Director: Legal Services, DPSA, indicated that in the area of deployment the current Act allowed transfer, in the public interest, without the employee’s consent or due process. The Bill made provision for transfers within the public service and secondments to and from the public service, with the employee’s consent or without their consent, but subject to due process as well a public interest requirement. Before employees may be transferred the relevant bargaining council must be consulted. If an employee on probation was transferred the probation would stand. There was express provision for the continued employment, despite the transfer, within the public service or to another organ of state, to retain pensionable and leave credits.

The Public Service Commission (PSC) was to conduct and issue directives on certain personnel procedures, and the executive authority must implement such directives within 60 days. In addition procedures were set out for discipline of heads of departments and for employees, and any transgressions were to be reported to the Minister of Public Service and Administration, who was to report annually to the relevant committees of Parliament. Transgressing national executive authorities may be reported also to Cabinet and provincial executive authorities to provincial Cabinets via Premiers.

Currently, the Act provided that the head of a department had the power to dismiss an employee for misconduct, but the disciplinary code provided that the Chair at the hearing would pronounce of sanction. The Bill proposed that any sanction imposed by the disciplinary hearing must, subject to internal appeal, be implemented by the Head of department. Provision was also made for the continuation of a disciplinary hearing by a new department in respect of alleged misconduct at the former department of an employee and the two departments would need to cooperate. The Bill empowered the Minister of Public Service and Administration to make regulations on the powers of chairs of disciplinary hearings and to provide for matters such as costs.

Grounds for dismissal were aligned with those recognised in the Labour Relations Act, and sought to amend current discrepancies in the deemed dismissal grounds. Prohibitions on re-employment of dismissed employees in respect of prescribed categories of misconduct were introduced. Emphasis was placed on misconduct related to corruption. The detail was fully set out in the presentation.

In the area of outside remunerative work, it was proposed that the current requirement that an employee must place the whole of his/her time at the State’s disposal be omitted. This was to accord with the Basic Conditions of Employment Act (BCEA). It was proposed that criteria for the granting or non-granting of approval for outside remunerative work be included, which included interference with effective performance, or conflict of interest.

The Bill also proposed that heads of departments be allowed to submit their grievances straight to the PSC. Employees, except the heads of departments, were first to exhaust their grievance procedures within the department before referring their labour dispute to the bargaining council.

The former provisions in respect of political rights of employees were omitted, as they were dealt with in the Constitution and limitations in code of conduct. The candidatures of employees for legislatures were proposed to be regulated in the PSA. Candidates may be subject to prescribed conditions. Employees were only deemed to have resigned from the date that the elected employee assumed duty.

The Bill also now aligned the Regulation making powers. Currently, the Act authorised regulations for deviation but did not allow retrospectivity. There were instances where it would be good to allow for retrospective effect for deviations, but the provision in the Bill was balanced by the requirement that it was for the purpose of ensuring equality.

Similar to the PFMA, the Amendment Bill also proposed comprehensive provision for delegation of all functions that were vested by the Act or regulations. Conditions might be imposed when delegating functions. The original functionary remained accountable for how the functions were exercised, and delegations could be withdrawn.

Discussion
The Chairperson asked for clarity on the definition of the term “socio-economic”.

Ms van Schoor said that the Bill only referred to the term “socio-economic rights” in one clause, which was cross referenced to a clause in the Constitution, and there was no need to elaborate on its definition in this Bill

Kgoshi L Mokoena (ANC, Limpopo) thanked the department for their presentation and asked that they should go through the Bill again, clause by clause at a later stage.

Mr J Le Roux (DA, Eastern Cape) said that the DA members in the NCOP and NA had not finished the consultation process. It was impossible for the DA to discuss the desirability of the Bill at this stage. He said that they only had one informal meeting on the bill and it would be defeating the object of the NCOP if they were to rush the process.

Mr Herman Smuts, State Law Advisor, said that, as far as he knew, this was still an informal process and only when debating the desirability of the Bill would it enter the more formal stage of clause by clause deliberations.

Kgoshi Mokoena reiterated that the Members could not yet brief provinces on something they looked at informally.

The Chairperson said that after consultation it was agreed that the members should ask question on the broader issues raised by the presentation. He said that the Committee would meet again where they could go through the Bill clause by clause.

Mr D Worth (DA, Free State) asked, in regard to the various departments the DPSA was trying to bring together, what would happen to pension and medical schemes.

Prof Levin said that there needed to be a separation between the Public Service Amendment Bill and the single Public Service legislation process. The Department was given a mandate to consult on the draft Bill. He said that this Bill did not deal with anything outside of the Public Service.

Mr Le Roux sought an explanation on how the Bill would affect the free movement of personnel as he felt that the personal power of people who wanted to stay in certain jobs could be taken away.

Prof Levin said that this Amendment Bill was much fairer to employees than the current position where an employee could be transferred without his/her consent or due process. The Amendment Bill required consultation, although there could at the end of the day be an order that did not reflect the employee’s feelings.

Mr N Mack (ANC, Western Cape) noted that if an employee was in jail he must have been found guilty of some misconduct.

Mr Mulaudzi said that if an employee was away from work for one calendar month he/she would be deemed as dismissed. This Bill had added a further category of supervening impossibility, and the reference to long jail terms was used as an example.

Mr Mack said were some employees that did outside work without permission. He wanted to know how the Department would deal with these individuals.

Prof Levin acknowledged that some employees did have remunerative work outside of the public service. If this was without permission then they could be subject to a disciplinary process. It was important to regulate this because outside work could undermine the efficiency of the public servant. If there was a conflict of interest it could lead to corruption.

Mr A Moseki (ANC, North West) asked for clarity on the political rights issue. He pointed out that there were many elected public representatives at local level. He asked whether the Bill would be retrospectively applied to councillors.

Ms van Schoor said what DPSA were proposing in the Bill did not apply to current members of legislatures or municipal councils. It would only apply from the next election. DPSA did allow employees to be part time councillors but they would need to obtain permission to retain remuneration.

The Chairperson asked what rights government had on a person outside of working hours.

The Chairperson asked if the term promotion was going to be done away with.

Ms van Schoor said that if an SMS was appointed to a higher post it would be called “appointment to a higher post”. DPSA did not want it to be called a promotion because they were attempting to avoid the situation where the unsuccessful candidate could be given the opportunity to declare an unfair labour dispute. A large number of cases at the bargaining council were dealing with those who were unsuccessful in being appointed to a higher post, whereas other matters were in fact more important.

The Chairperson referred to the statement that the head of the component must report to the executive authority and the accounting officer. He asked if dual accountability was going to cause a problem in the system and asked what the rationale was behind the idea.

Ms van Schoor answered that the head of the government component would be accountable to the executive authority

Kgoshi Mokoena referred to page 3, clause 1, of the Bill and asked if all the definitions that were underlined were now in the Bill. He pointed out that some of them were included in the Labour Relations Act. He asked if the underlined definitions in this clause were completely new or were they taken from the Labour Relations Act.

The Chairperson asked for clarity on the establishment of components. He also asked about the definition of executing authority and what the benefit of changing this definition was.

He requested some clarity of when people “must” go to the bargaining council.

The Chairperson commented that the aligning of all departments was a good idea and hoped that all departments would be treated the same in terms of the new Bill.

He further noted he was happy with the clauses relating to the continuation of disciplinary proceedings and asked if this would include parastatals.

Prof Levin said that state owned entities were governed by different legislation. DPSA would not be able to intervene in this case.

The Chairperson also asked about the committee that would be convened to concur on salary adjustments and asked what the implication of this was.

The Chairperson also asked for clarity on the establishment of components.

Prof Levin said that the committee and the collective bargaining process was very important. It was also important that one minister could not get isolated. DPSA wanted to stabilise the public service, and in order to create stability the key ministers from the key sectors must get together to strategise. 

The meeting was adjourned.